Reselling Brisbane Apartments Means Selling At A Loss

Apartments purchased off-the-plan at the beginning of Brisbane’s unit-construction boom are selling at significant losses, underscoring concerns from the Reserve Bank about the city’s concentrated inner-city property market.

Across Brisbane, the preliminary auction clearance rate was 51.5% last week, according to CoreLogic.

This was slightly up compared to the same period last year.

For the Gold Coast, last week’s clearance rate was 37.5%.

Andrew Coronis, managing director of Coronis real estate agencies, said price drops of 20% to 25% were not uncommon for resales after off-the-plan purchases.

“It is just time to sit and ride it out if you can,” he told The Australian.

“If rents drop a bit the yields still aren’t too bad. If you do have to sell, it’s better to do it now. I don’t believe it will get better in the short term.”

Coronis said he was bullish about the long-term market, noting that population and jobs growth across the region would propel the market.

He also pointed to the relatively strong yields based on the median unit price: $410,000 in Brisbane.

The current glut of apartments is causing anxious Brisbane landlords to resort to desperate measures to secure tenants, according to Yardney.

“Typically they’ll offer at least a month’s free rent to incentivise a tenant to take a 12-month lease,” he said.

“Other landlords are even offering an iPad, a free gym membership or a gift voucher to secure tenants. One large Fortitude Valley developer was recently offering three months free rent and $1,000 cash to tenants who took 12-month leases.”

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